[UPDATE 1:40 p.m.] Judge Decides Lawsuit Over Measure S, the Humboldt County Cannabis Tax
Yesterday afternoon, a decision came in the suit claiming that Humboldt County Supervisors illegally modified Measure S, a cannabis tax agreed to by the voters in 2016. According to ED Denson, an attorney who filed the suit along with fellow lawyer Fred Fletcher, the Supervisors unanimously changed the wording mid 2017. Denson said in a social media post,
[W]e won 3 of the 5 points at issue. The judge said that the county could not change the person taxed from the grower to the property owner, and they could not change the area taxed from the cultivation area to the area on the county permit, and they could not charge anything to people who had a permit but didn’t grow.
On the other hand, although the ballot measure said the tax was biennial, (…collected every 2 years) that was what we in the law call a “scrivenor’s error” (spell check didn’t know that one either) for biannually (twice a year), and although the ballot measure said that to be taxed you had to be cultivating in compliance with local, state, and federal law, no voter could have believed that the tax would be held up until federal legalization. Had we prevailed on the federal issue, no one would have owed any tax at all. As the law stands with this decision, some people have been wrongfully taxed, others have been rightfully taxed. The wrongfully taxed should get refunds, with interest, I think.
The County could appeal the decision.
Supervisor Estelle Fennell and ED Denson did not immediately responded to phone calls requesting information. We’ll update if we are able to gather more information.
UPDATE 1:40 p.m.: ED Denson returned our call and provided a copy of the Judge Kelly Neel’s decision (see below.)
According to Denson, there are three groups of people who could potentially get refunds of Measure S tax money they paid to the County if the County doesn’t appeal the case.
The first group are landlords who were renting or leasing to a cannabis grower but weren’t part of the grow. “They should get their money back,” Denson told us. “Measure S said they were going to tax the people who were growing, not [landlords.]”
The second group, he said, are people who didn’t grow but had a permit so they were taxed anyway. Some growers were taxed even though they didn’t actually grow cannabis simply because they had a permit to grow.
And the third group are people who grew less than the amount they were permitted to grow. Because Measure S is based on square footage, Denson said they should now be able to claim the difference between the actual size of the grow and the larger amount they had a permit for.
Denson said that he hasn’t crunched numbers on the amount that the County could potentially have to refund but, he said, ” I wouldn’t be surprised if it was over a $million dollars. I seem to recall people who didn’t grow on an acre. That would have been about $40,000.” (At one dollar a square foot, that would be $43,560.)
Denson cautioned, “We’ve yet to see if the County is going to appeal the hearing. If they appeal, we don’t know if there will be a stay on refunds. I would suggest nobody count their chickens yet. ”
Below is the decision from Judge Neel:
Cantax Measure S Judicial Ruling 14FE20
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Interesting times and the reality changes from one person to the next. On one hand, you have cultivators crying about taxes and fees and boo hoo this that and the other, we can’t make it and on the other hand, people are buying up farms, expanding, can’t grow enough and haven’t bitched about taxes and fees once.
Man, you don’t understand business…. You have to have a somewhat even playing field in something this easy to scale up… Lawyers, red tape, regulations, its a huge mess. The State and county are trying to create a fascist pot dystopia… ANYWAY BLESS U ED D.
Everyone is Bitching!
Bitchin? I know I’m bitchin… you should see my ride… its bitchin too… stay hating government [edit]
The changes to the law made by our supervisors were illegal. Are you advocating that lawmakers should be able to make up their own laws to tax the community without voter approval? That is a dictatorship. The varying perspectives you speak of have more to do with ability to afford the permit process. If you have a million just laying around, paying 100k for a permit isn’t a big deal. If you live humbly, cultivate consciously, deal with integrity, pay workers good /livable wages etc you often dont have that kind of money. Those who had enough money to write endless checks to be in compliance more often than not do bc they cultivated illegally and for profit.which is fine by me except that Small farmers who never grew to get rich don’t have that kind of money and so they are excluded. I wonder Where the elders and permitted farms are speaking out about these injustices? only rich people are allowed to grow now and that impacts at least 90% of this once thriving local industry, rippling out to everyone and everywhere else. Wake up folks! Remove Estelle! She doesn’t stand up for her constituents, only her friends. She is destroying the community for a quick buck over and over again. We cannot survive another 4 years of this dictatorship.
So you are saying people who applied for permits on small gardens, who were taxed for being in the process,but never received their permits, and then had to pull out of the process because they were being taxed on a business they did not yet have, on top of paying permit fees, should just get screwed? F@$k You!
Doctrine of Scrivener’s error is a legal principle which permits a typographical error in a written contract to be corrected by parol evidence if the evidence is clear, convincing, and precise. However if such correction affects property rights then it must be approved by those affected by it. Scrivener’s error is an error due to a minor mistake or inadvertence and not one that occurs from judicial reasoning or determination.
Appeal time. I bet ED and Fred win 4 of 5 by the end of this charade
“ And the third group are people who grew less than the amount they were permitted to grow.”
I smell a new loophole about to be exploited
The biggest problem is going to be landlords renting to an insolvent grower. Can’t get the fines from the landlord and can’t get it from the vanishing grower. In fact anyone who grows will likely have a legal “who me” fake contract with a fall guy. What a windfall for a lawyers.
Yep even though I paid the taxes my land ladies would never be honest and give it back to my business….I wonder if the tax assessors office has cameras
We should charge the landlords of all the stores that have gone out of business.
Its thier fault
This has been brought up many, many,many times. State law says if plants are non-contiguous and planted 10′ apart plants shall be measured individually.
Provide link to the ‘many, many, many times’ State law you reference.
Betcha can’t.
Just look up state law yourself
Been there, done that (many, many, many times). Doesn’t say it. Never did.
The fact that you can’t provide the quote but instead want me to look up what I have in front of me every day speaks volumes about your position.
JB
Guess I’m wrong. The problem comes from the word ” canopy” it implies coverage or umbrella to that effect. You shouldn’t be charged for dirt around your plants. Greenhouses only get charged for the planter box square footage not the aisles even though you have to push the plants aside to get through. I wish you could make money off bare dirt but unfortunately you can’t. Hopefully this makes sense now.
I completely agree with you that the ‘canopy’ is weirdly defined.
My position reflects many years of hard work. Firefighter, Mechanic, Carpenter, Equipment Operator, one thing I surely understand is the story of the poor. Some people were happy with a small farm that took care of emergencies and unforseen circumstances. The current permit process has ruined lives, friendships, and relationships due to the head turn and chin up attitude our governing liaisons project. We now have to borrow, negotiate, and hope we can somehow double production to appease the officials. Don’t get me wrong, no complaint here , but ask yourself “Is this working”? “For Everyone”? We the people have heart and are always there to help the unfortunate even if it’s not reciprocal. All we can say is “God Bless”.
We grew 10 k and hot charged for 20 k
Yeah that might work if the county weren’t eyeing every parcel, especially permitted farms like a hawk via Satalight. If you have a permit and move a plant they send you a letter with fines.
They aren’t watching permitted farms “like a hawk”. Otherwise the shit show grows near me would be shut down or be made to comply.
they absolutely are watching like a hawk but not for anything you might expect like environmental disasters or black market sales. They are looking for change in sq Ftg to charge people more. Hello folks This is a shake down! Your neighbors probably know Estelle. That’s how it works around here. If you know her and bohn you can do whatever you want. There are a different set of laws for everyone else
Sorry, your scenario is way off. Try again.
You poor idiot. I wish people would wake the hell up already. This is a true story that has happened to several people I know. The planning debt is charging people for expanded canopy for moving plants in the sun. They have detailed sat photos for the shake down. absolutely Estelle and Rex’s friends get preferred treatment. Duh. Just wait till the report comes out.
Well, for fact, they are NOT watching if you have a state license and actually have a state legal operation. My neighbors have not sold 1 gram legally. One would think the county would actually make sure you had a state license before cultivating. Nope, pay the sf tax and you can operate however you wish. They are also not watching for people cutting Oak trees or pumping creeks dry. One of the creeks is 100% salmon and Steelhead spawning. Pumped bone dry this last season. They are already back at it with NO state permit!!
CONGRATULATIONS ED!!! This is a huge win, especially the timing of it, coming just before the supervisor election of two of the supes who made these illegal changes to a law that was decided by the voters. Neither of them deserve the vote of anyone who supports legal cannabis.
Vote for Cliff Berkowitz
1st District supervisor.
Stop the status quo.
This county needs a trusted voice to move this county forward
Cliff is the wrong candidate for the 1st district, he is better for mayor of arcata. Cliff does not repusent the electorate of the 1st district.
I live in the first district and Rex Bohn has never represented, benefited or helped me. Instead, he has represented, benefited and helped people, like his son and his son’s thug business partner, who do not live in the first district. Who else does Rex represent? A bunch of corporate growers who live in L.A., Chicago, San Francisco. Vote for Cliff!!
I would like to know if the county counsel was consulted by the supervisors before making those illegal changes in 2017.
Yes
Thank you Ed, and would you happen to know if this is the same county counsel who came up with the legally doobius $10,000 a day abatement fines? If so, and I only suspect it is the same person, I think that their name should be brought forward into public discussion a bit more.
Yep congratulations ed good job bro !!!!
Love to see our theiving supervisors put in there corrupt places 12 days till a couple of them are hopefully ejected.perfect timing as they slither,and lie to weasel another few years of undeserved 100,000 dollars a year of our tax dollars!!!!! This story made my day 😊
VOTE OUT ESTELL and the CORRUPT BIG AG SCUMBUCKETS! PRIME AG MY ARSE
Yes we SO need to vote out Estelle (and bohn, who in my opinion is toast). There are 4 challengers in Estelle’s district though. So let’s all get in alignment with the most progressive replacement supervisor so we win. We are in dire need of a Sup who has new ideas, awareness of law, one who stands up for justice, with a long history of whistleblowing. We need a Sup who genuinely, humanly and consciously represents the interest of the majority. in these crucial times of transition we need a policy maker who understands the local economy, who sees the potential and works for the families and farmers being displace in favor of major ag today, no thanks to Estelle’s spinelessness in representing district 2. Estelle’s list of qualifications and endorsements may seem impressive, until you look deeper and see it is merely her wrap sheet of service to her big money donors at the expense of the majority. Sorry but that is not an admirable qualification. 8 years worth of this devastation is only evidence that you are as corrupt as they come. The cops who make money off of criminalizing people endorse her, enough said. For a prosperous district 2 vote Sean DeVries please!
Right on Ed, good job to you.
I don’t believe anyone voting for this intended for people to get taxed for what they didn’t grow.
I cant think of any industry that taxes you on what you could grow and does not allow folks to fallow.
The county continues to pressure folks to pay for grow space that is being layed to rest
Good job denson.
Now we just need this agricultural commodity to be run by the agricultural department.
They have handicapped bathrooms and proper parking,and not the bad attitude.
Switch agricultural to ag . department.
Maybe that will give the comiance department time to get those building up to compliance.
And why is Estelle not backing her people.
The abuses from Planning and building are blatant.
Anyone remember when the plannjng department sent out the letter at christmas time scaring people into signing before the first of the year.
The folks who signed it got a tax bill.
The did who were lucky enough to have a lawyer to call on Christmas didn’t sign it and didn’t get a tax bill.
Im get to g friends of supervisors got a warning not to sign it.
This is more about sleazy business practices than anything else.
Get this whole tho g out of planning and into ag where it belongs.
And let’s move on.
And yeah there are definately some refunds due.
I am one of the people who got scammed into signing that letter.
The county extoreded me for $7500 dollars. Other farmers were laughing at me telling me they were told not to sign it and now did not have the pay the tax for the year. What a scam! others who cultivated huge amounts never had to pay any tax and i got tricked into “doing the right thing” and got screwed.
Most likely the same way the “safe homes act” will play out with the county offering a deal where you admit to unpermitted buildings and they will wave penalties. No thanks, I’ll ride that one out.
Yes! It was attorney ED Denson who warned ‘my friend’ to NOT sign or send it tax payments before the end of 2018.
Thanks ED, that saved thousand of dollars!!
Great job Ed!
Vote on March 3rd
Can we vote that hideous mural off the wall and back into the clipart folder?
And replace it with what? You gonna pay for it?
Humboldt county has so much at stake. Supervisors shouldn’t have that much leverage and power. Please vote on March 3rd
This has been brought up many, many,many times. State law says if plants are non-contiguous and 10′ apart they shall be measured individually. A 10,000sqft grow can have 400 5×5 plants. Also all illegal cultivation abatement charges were based on a 2.00 a square foot charge. If your plants were tiny and you were charged an area circumference you should see a refund.
Provide link to the ‘many, many, many times’ State law you reference.
Betcha can’t.
Sec 8000(f)(2) explains non-contiguous. It seems they took the 10′ part out. Too bad for the people who followed the original text.
I’m intimately familiar (and have archived) every proposed (and temp) version of that code. It never said what you claim it said.
Myth
JB
Maybe you could explain non-contiguous for me
The State (fuzzily) defines it in the very paragraph you get the word from …
It’s a canopy separated by ‘identifiable boundaries’ (many of which are listed).
Trust me … we agree that it’s weirdly worded. We laughingly refer to it as the ‘garden gnome’ paragraph (a take off on them listing ‘garden benches’ as a boundary).
Thank you.
I appreciate the constructive response.
It’s been a real struggle to read these laws and derive a conclusion. The best I’ve been able to muster and keep sanity is to listen to the definition explained by our officials, even though it may seem nonsensical at times. Believe me I’ve eaten a turd sandwich many times trying to explain my thoughts and fighting for square footage. These days I just want it to be over and get back to farming with the ability to fulfill the obligations I’m responsible for.
Best wishes. It’s a real slog rising above the regulations.
Are you a consultant? My last one took a dump on me right in the middle of a 30 day deadline for revisions.
Thanks Ed. I’m glad you are sticking up for the small people of Humboldt.
ABE. Anybody but Estelle.
Good job Mr. Denson!
I’m still appalled that our supervisors made licensing for the small farmer so hard and expensive while all the big growers with hundreds of thousands to spend of course had no problems. They are responsible for all the businesses that are going under in this county today. One right after the other.
This rollback is just not just at the county level. The state is looking at doing away with the tax on cultivation. The whole legal pot scene is a mess. The proposition that “legalized” recreational use was short on details regarding implementation. Regulating the new industry has turned out to be far more complicated than anyone thought. 75% of California cities are not allowing recreational sales. Much of this is do to concerns with dosage and contamination. Cities are not interested in being the FDA. There are voices at the state level saying if they don’t do something constructive soon the whole “legal”recreational scene is going to collapse. Good on you Mr. Denson and your partner in this. There are a number aspects to this mess that may end up being resolved through litigation
Epic work again ED and Fred! Everyone should take their refunds and donate to ED and Fred who are always fearlessly on the frontlines fighting for basic rights for so many without a voice in our community, just because it’s the right thing to do.
We were charged 20 k two years later and only grew 10 k we brought this to there attention multiple times
ABE
Anyone but Estelle
Estelle backed the letter
Estelle did nothing to stop comiance from going after 6 plant grows .
She dies not understand pot.
Vote
Vote
Vote
Not one Estelle sign as I drive around. In fact, 100% of the people I have spoken with, are NOT voting for Estelle.
Don’t get too comfy. No signs only mean that she knows she will NOT lose in June. Her worse case scenario is a likely runoff. That’s when she will spend her money.
And don’t judge just by signs. Look inside this week’s ‘Independent’ newspaper (and likely others too). She has a HALF PAGE AD for her campaign.
The primary has moved up to “super Tuesday” March 3 this year. The bulk of the votes in the 2nd district come from the Fortuna/Rio Dell area. Estelle has some very prominent signage locations up there and frankly I don’t see DeVries or McKaskle making a dent in that area. My guess is Bushnell will get some backing but I don’t really know.
There is a rumor that folks in Mendocino are incorporating their townships to get away from the corruption if the supervisors down there.
Could be worth looking into.
If you are going to vote for Trump but are all in a huff about Estelle’s and Bohn’s “corruption ” then you get the hypocrisy award of the year.
Just sayin’…
Ohh yea. Most people are going to vote for trump. You’ll see. Going to be painfull 4 more years. You must not have watched debates. Nice try yea sure you’ll see 🤣🤣just wondering which losing candidate you’ll be voting for. I promise you will lose😢😢
So Clinton said about her assured election in 2016. Actually exactly the same thing and called those voting for Trump deplorables. Having vocal contempt for people who disagreed with her surely gained Trump some votes. It isn’t done until it its final so don’t be Clintonesque.
But but Hillirrrrrryyyyyy !
Agh , The Clinton’s!!!! Nothing but stale Righty talking points. You bots need to get up to speed.
Thank you for the Righty talking point that has been repeated so many times it has lost its zing, if it ever had one. 😂😂😂😜😄😜😂😁😬😈👎👎😭😜😳😬😂😁☹️😃😑😈👹🏆🏆💩💩👏😂😁☹️😳😬😜😄😒🎉😂😀✊☕️️🙌💩😍☹️.
Your going to be crying while I’m smiling. Period end of story. Get used to it yea sure. It’s a fact. You can’t to anything You will lose I promise
This is indeed a step in the right direction Ed Denson. It appears to me that the County exceeded their authority by the taxing of a Federally illegal AG commodity. However the County could easily establish that people were waiting in line with their checkbooks to buy into the scheme.
It sorta makes one wonder … does anybody deserve a refund? NO.
Every individual who paid cannabis cultivation taxes to the County, lost money on their own speculation. They were cautioned repeatedly to the fact that the tax scheme was illegal, they still paid for protection from punishment.
Thanks all you “legal” check writers, the County needs your free money.
Get real. Everyone made bank on the black market.
Well, everybody who got a tax bill got it because they had a permit – even an Interim permit. Tax law has an odd twist to it. If the tax is illegal and you don’t pay it, you get a penalty for non-payment. If later it is shown the tax was illegal you don’t owe it, but you don’t get your penalty back. And, of course, if you don’t pay the tax you lose your permit. You could sue if the tax were overturned, but damages would be difficult to prove. On the other hand if you pay the illegal tax, you don’t get penalized, and you keep your permit. When the tax is found to be illegal by the court, you get your money back. With interest? Unclear if you get interest, and if you do, unclear at what rate. But this is all futures. The law, as it stands, is unfair. But taxes are so unpopular that if you didn’t have to pay them till the tax worked its way thru the courts, the governments would starve to death.
ANYBODY BUT ESTELLE!!! And bone !!!!!
love it, the cry for our basic rights that were promised to us by the constitution and the gentleman that started this country!!!! Sad that slimy people in power are always trying to steal all they can from us !!! Go vote people stand up for yourselves, your freedom, your freinds,neighbors ,your elders !!!!
Thank you Ed.
Once again we are having to hire private attorneys to hold our county official accountable.
The county needs to go back to taxing us for disturbed soil and not fence line.
I have been fighting with county on this for years and the county is delaying signing off and giving my permit.
I think we all need to vote in new supervisors who will work for the people., so get out and vote.
If we do disturbed soil more people will be able to afford the permit process.
And since we are working with building department ,then we should pay a fee to have county come out and review our site like we do when we are applying for a building permit.
Because now we hire engineers and companies before county comes out and the companies /engineers /and water resource companies like Pacific Watershed associations and they over charge for information that you might not need.
We all need to vote and take our county back from the supervisors who have been doing a poor job for the people of Humboldt County.
So get out and vote!
Well said
Very good, Ed. Keep doing what you do. The level of incompetence and laziness (ass-kissing career politicos) coming from our supervisors and representatives on up the chain of command is criminal by itself.
Everybody knows, marijuana should have been completely decriminalized over a decade ago. All problems associated with the plant are created by its ridiculous prohibition.
Thank you Ed now it would be awesome if our greedy supervisors could be thrown in jail for the crimes and lose their property to boot. That would be justice. Shouldn’t there be some punishment?!
Incumbent Supervisors need to be replaced. They are far to comfortable fining property owners, demanding and collecting illegal taxes and voting themselves a raise. People should show up and voice their concerns at the Board of Supervisors meeting.
Leased property w/ 4 24×80 beds Cultivation permit under tenant name and plans for expansion…got taxed for outdoor and mixed Light (nexer even had power available), tenant never paid rent nor Cultivation tax, i contacted county who told me i was responsible for $33k in taxes and would not review sqft. And type of Cultivation, that i was reponsible. Have not had any luck reaching anyone that occupied the parcel, had to pay finally 2 weeks ago, now this lawsuit passes represents a victory for many in my position.
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